JASMEET SINGH WALIA,NEW DELHI V. ITO WARD 58(8), NEW DELHI

ITA 567/DEL/2024

AI Insights

The case involves Jasmeet Singh Walia, who appealed against the orders of the AO and the Commissioner of Income Tax (Appeals) [CIT(A)], which upheld the addition of Rs. 28,48,000 to his income for the assessment year 2017-18. The addition was based on unexplained cash deposits during the demonetization period. The AO and CIT(A) were not convinced by the explanations and documents provided by the assessee, leading to the appeal. The Tribunal found that the AO had not adequately examined the documents submitted by the assessee and remitted the matter back to the AO for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 31686 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: SANJAY KUMAR
• Assessee Lawyers: TARANDEEP SINGH
• Keywords: Opportunity of being heard; Additional evidence; Non compliance
• Section: 234B

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “SMC”, NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER, ITA NO. 567/Del/2024 A.YR. : 2017-18 JASMEET SINGH WALIA, 36, KANTI NAGAR WEST SHAHDARA, NEW DELHI – 51 (PAN: AASPW8797L) VS. ITO, WARD 58(8), NEW DELHI (APPELLANT) (RESPONDENT) Appellant by : Sh. Tarandeep Singh, Adv. Respondent by : Sh. Sanjay Kumar, Sr. D.R. Date of hearing : 20.02.2025 Date of pronouncement : 20.02.2025 ORDER PER SHAMIM YAHYA, AM : The Assessee has filed the instant Appeal against the Order of the Ld. CIT(Appeal)/NFAC, Delhi dated 20.12.2023, relating to assessment year 2017- 18 on the following grounds:- 1. That on facts and in law the order dated 22nd December 2019 passed by the Assessing Officer {hereinafter referred to as the “AO”} is bad in law and void ab initio. 2. That on facts and in law the impugned order dated 20th December 2023 passed by the Commissioner of Income Tax (Appeals) {hereinafter referred to as the “CIT(A)”} is bad in law and void ab initio. 3 That on facts and in law the AO I CIT(A) have erred in not granting 2 | P a g e adequate opportunity of being heard and thereby violating principals of natural justice. 4. That on facts and in law the CIT(A) has erred upholding an addition to total income of Rs. 28,48,000/- alleging that nature and source of cash deposits remains unexplained. 5. That on facts and in law the AO / CIT(A) have erred in not appreciating that nature and source of money deposited in bank account by the appellant post demonetization was fully explained and substantiated. 6. That on facts and in law the AO / CIT(A) have erred in making / upholding the impugned addition premised suspicion, conjectures and surmises. 7. That on facts and in law the AO / CIT(A) have erred in invoking provisions of section 115BBE of the Act. 8. That on facts and in law the levy of interest u/s 234B and 234C are bad in law. That the appellant craves leave to add, amend, modify or alter the grounds of appeal. 2. Brief facts of the case are that assessee is involved in manufacturing the hardware items i.e. Butt Hinges, Man handled, agricultural items and also wholesale and retail of iron steel strips/ sheet C.R. sheet. Assessee filed his return of income declaring income of Rs. 11,04,470/- on 29.10.2017 which was picked up for CASS by the AO. During the year under consideration, the assessee had deposited cash amounting to Rs. 28,48,000/- within the period 09.11.2016 to 31.12.2016 and was directed to explain the source of the same being cash deposited during demonetization period. The assessee in response the questionnaire furnished the documents viz. Bank statement evidencing deposit of cash and explaining that the source of such deposit is ‘cash sale’; copy of the VAT returns evidencing the total sale amount of the assessee was also submitted and return of income for previous years was also submitted. 3 | P a g e However, AO was not convinced, hence, he added the cash deposit of Rs. 28,48,000/- u/s. 68 of the Act in the hands of the assessee. 3. Upon assessee’s appeal, Ld. CIT(A) noted that remand report was obtained from the AO and proper documents were not provided by assessee. Ld. CIT(A) by taking support from the remand report, upheld the addition. The order of the Ld. CIT(A) may be gainfully referred as under:- ”5.3 During the appellate proceeding, a remand report was called for and the same was submitted by the assessing officer on 07.11.2023. The assessing officer in remand report stated that the appellant/assessee was given adequate opportunity to produce evidences/documents in support of cash deposit of Rs. 28,48,000/- in his bank account of Vijaya Bank. The assessing officer also mentioned in remand report that the appellant had provided only Balance sheet/ P&L accounts, summary of sale/outward branch transfer register but not provided VAT return as claimed in submission before CIT (A). Further, the assessing officer stated that the appellant had not provided any other documents likes Cash Sale Register, Cash Book. The assessing officer, after considering the submission made by the appellant before CIT (A), recommended not to accept the additional evidences. 5.3 The remand report received from the AO was also sent to the appellant for comments. However, the appellant sought adjournment for the same. During the appellate proceeding, the appellant was given ample opportunity to produce evidence in support of his appeal but the non compliance on the part of the appellant shows lack of genuineness. Merely because the appellant is not vigilant, it cannot follow that the appellant is bestowed with a right to the delay the proceedings. Hence, the request for adjournment is not accepted. 5.4 On perusal of the submissions of the appellant, it is noticed that there was sudden surge in sales only in the month of October, 2016 i.e. prior to the period of demonetization, in the absence of any evidences, it is crystal clear that the appellant wants to increase his cash in hand to explain his unaccounted cash deposited during the demonetization period. After considering the assessment order, remand report and the submissions filed by the appellant, it is noticed that the appellant has not furnished any daily cash sale register/invoices in support of cash sale and cash deposits during the assessment proceedings as well as during appellate proceedings to substantiate his claim. The assessing officer also mentioned in remand report that the appellant had already submitted the same submission, as filed before CIT(A), during assessment 4 | P a g e proceeding and there is no new things in his reply which are brought before the appellate authority. Therefore, in absence of any documentary evidences, order of the assessing officer is confirmed herewith. Hence, the ground of appeal 1 is dismissed.” 4. Against the aforesaid order, Assessee is in appeal before me. 5. I have heard both the parties and perused the records. Ld. Counsel for the assessee pleaded that assessee has duly deposited the amount of Rs. 28.48 lacs out of which cash sales and necessary documents including the VAT returns were provided, despite acknowledging the receipt of the same due credit of the same has not been given. Per contra, Ld. DR could not controvert the submissions of the Ld. AR. 6. Upon careful consideration, I find that assessee has submitted the necessary documents, but AO has failed to examine the same, hence, in the interest of justice, I remit back the issues in dispute to the file of the AO with the directions to consider the same afresh, in light of the submissions of the assessee and decide the issues as per law, after giving adequate opportunity of being heard to the assessee. 7. In the result, the Assessee’s appeal is allowed for statistical purposes. Order pronounced in the Open Court on 20/02/2025. SD/- (SHAMIM YAHYA) ACCOUNTANT MEMBER SRBHATNAGAR Copy forwarded to:- 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR, ITAT Assistant Registrar "